WASHINGTON - The Federal Deposit Insurance Corp. tentatively plans to meet Jan. 30 to consider the best way to cut bank premiums, while the Federal Reserve Board is scheduled to meet Feb. 22 to finalize new rules implementing the Community Reinvestment Act.
The FDIC, the Comptroller of the Currency, and the Office of Thrift Supervision also are expected to bring CRA reform to a close toward the end of February. The agencies have been working to revamp the CRA since June 1993.
Fed Governor Lawrence Lindsey, after a speech to the National Economists Club on Tuesday, told several economists that the central bank had selected the Feb. 22 date.
Regulators have already conceded that the tough enforcement actions they proposed will be dropped from the final rule. The Justice Department last month told the agencies that they lacked the authority to beef up CRA penalties.
The big question is whether the agencies will back down from plans to require banks to report the race and gender of small business borrowers.
Over at the FDIC, the agency must issue a proposal for comment on its plans to reduce the cost of deposit insurance. The proposal is expected to lay out when the FDIC believes the Bank Insurance Fund will achieve its target ratio of $1.25 for every $100 of insured deposits.
Once that level is reached, the agency is allowed to significantly reduce bank premiums from the current range of 23 to 31 cents per $100 of domestic deposits.
If the premium is reduced to a nickel, it is expected to save the industry $4.5 billion a year. The bank fund is expected to hit the 1.25% ratio in the second half of the year.